Discontinued Operations

9 Months Ended

Sep. 30, 2012

Discontinued Operations [Abstract]

Discontinued Operations

2. Discontinued Operations

In October, 2011 we entered into a contract to sell the assets and liabilities of our Albany Door Systems business to Assa Abloy AB for $130 million. Closing on the transaction occurred on January 11, 2012. Under the terms of the contract, Assa Abloy AB acquired our equity ownership of Albany Doors Systems GmbH in Germany, Albany Door Systems AB in Sweden, and other ADS affiliates in Germany, France, the Netherlands, Turkey, Poland, Belgium, New Zealand, and other countries, as well as the remaining ADS business assets, most of which are located in the United States, Australia, China, and Italy. In the second quarter of 2012, the purchaser completed certain legal registration activities in China, allowing the parties to complete the transfer of assets and liabilities of the ADS business in that country.

In the first quarter of 2012 the Company recorded a pre-tax gain of $58.0 million, including $17.4 million which was payable by the purchaser as of March 31, 2012. In the second quarter of 2012, we recorded adjustments to the sale transaction which had the effect of reducing the gain by $0.3 million. The initial purchase price of $130 million included $13 million to be paid in July 2013. We recorded the value of that consideration on a present value basis and, as of September 30, 2012, we have a receivable of $12.6 million included in Accounts receivable. Additionally, in March 2012, we agreed with the purchaser on certain post-closing adjustments and in April 2012, we received a payment of $5.0 million to reflect that agreement.

In May 2012, we announced an agreement to sell our PrimaLoft^® Products business for $38.0 million and that transaction closed on June 29, 2012. The Company recorded a pre-tax gain of $35.0 million as result of that sale. The purchase price included $4.0 million which is held in escrow and is included in Accounts receivable as of September 30, 2012.

In the third quarter of 2012, the Company recorded various adjustments that reduced the gains on disposition by $0.3 million, and also adjusted the tax expense allocated to discontinued operations by $0.7 million.

In accordance with the applicable accounting guidance for discontinued businesses, the associated results of operations and financial position are reported separately in the accompanying Consolidated Statements of Income and Balance Sheets. Cash flows of the discontinued operation were combined with cash flows from continuing operations in the consolidated statements of cash flows.

The table below summarizes operating results of the discontinued operations:

	Three months	Three months	Nine months	Nine months
	ended	ended	ended	ended
(in thousands)	September 30, 2012	September 30, 2011	September 30, 2012	September 30, 2011
Net sales	$ -	$49,760	$19,774	$155,990
Income from operations of discontinued business before tax	-	3,316	4,776	16,307
(Loss)/gain on disposition of discontinued operations	(301)	-	92,376	-
Income tax (benefit)/expense	(683)	1,135	25,570	5,397

The table below summarizes major categories of assets and liabilities for the discontinued businesses that are included in the accompanying balance sheets:

	Primaloft ®	Albany Door Systems	Total
	December 31,	December 31,	December 31,
(in thousands)	2011	2011	2011
Assets of Discontinued Operations:
Cash	$ -	$ 13,545	$ 13,545
Accounts receivable, net of allowance for doubtful accounts	1,338	35,120	36,458
Inventories	3,846	12,661	16,507
Property, plant and equipment, net	563	6,344	6,907
Goodwill and intangibles	-	39,227	39,227
Other current and noncurrent assets	60	5,114	5,174
Total assets of discontinued operation	$ 5,807	$ 112,011	$ 117,818
Liabilities of Discontinued Operations:
Accounts payable	$ 955	$ 8,300	$ 9,255
Accrued liabilities	545	10,883	11,428
Other current liabilities	-	1,763	1,763
Liabilities for defined benefit pension plans	-	9,513	9,513
Other noncurrent liabilities	52	4,552	4,604
Total liabilities of discontinued operation	$ 1,552	$ 35,011	$ 36,563